Preheat the oven to 350 degrees F. Spread the bread cubes on a sheet pan and bake for 15 to 20 minutes, until lightly browned. Set aside.
Meanwhile, heat the oil and butter in a large (12-inch) saute pan over medium heat. Add the pancetta and cook for 5 minutes, until starting to brown. Stir in the leeks and cook over medium heat for 8 to 10 minutes, until the leeks are tender. Stir in the mushrooms, tarragon, sherry, 1 tablespoon salt and 11/2 teaspoons pepper and cook for 10 to 12 minutes, until most of the liquid evaporates, stirring occasionally. Off the heat, stir in the parsley.
In a large mixing bowl, whisk together the eggs, cream, chicken stock and 1 cup of the Gruyere. Add the bread cubes and mushroom mixture, stirring well to combine. Set aside at room temperature for 30 minutes to allow the bread to absorb the liquid. Stir well and pour into a 2 1/2-to-3-quart gratin dish (13 x 9 x 2 inches). Sprinkle with the remaining 1/2 cup Gruyere and bake for 45 to 50 minutes, until the top is browned and the custard is set. Serve hot.
Photograph by Steve Giralt
Courtesy of Food Network Magazine